CH2M HILL’s Nick Pealy discusses the benefits of adopting an asset management approach to streamline operations.
By: Nick Pealy, Senior Consultant, Asset Management and Reliability Services, CH2M HILL Operations & Maintenance Business Group
This post concludes a series of Access Water posts about asset management best practices. Read the other blogs in the series.
During the last several months, Access Water has featured a series of blogs to highlight key findings from a McGraw-Hill Construction study of asset management practices of US and Canadian utilities. CH2M HILL’s sponsorship of the study is one way we are helping expand industry knowledge on 14 leading asset management practices understanding. Utilities and organizations can use this knowledge and incorporate best practices to increase the reliability of their plants, equipment and other infrastructure, while also generating additional revenue and substantial financial savings.
In the US and Canadian water industries, the benefits of adopting asset management practices are clear. The study confirmed advanced adopters of asset management can:
- Better explain and justify budget proposals to decision makers;
- Sharpen the organization’s focus on priorities;
- Increase the organization’s understanding of the risks and consequences of alternative investment decisions;
- Balance spending between operations and maintenance, and capital investments more effectively; and
- Reduce costs without reducing service levels.
What is it about the asset management framework that results in these benefits?
First, the framework focuses not just on physical assets, but on the processes, technology and human resource capabilities necessary to efficiently and effectively maintain, repair and replace assets over their life cycle.
Additionally, the framework focuses on customer outcomes – by applying the methods and practices that encompass asset management, prioritization of spending is focused on activities and investments that result in the best outcomes for customers, while managing risk to an acceptable level.
Finally, the framework emphasizes the use of data. Decisions about where to allocate resources are not made based on a “gut feeling” or by simply repeating what was done the previous year, but rather by relying on data and analysis to confirm where investing capital will yield the highest returns and benefits for customers.
Ready to take the next steps?
If your organization or your client is thinking about implementing an asset management program or advancing an existing program, be methodical and implement an asset management approach that benefits your organization in a meaningful way. Convince decision makers by conducting a thorough evaluation and business case to prove the benefits that can be achieved by implementing an asset management program.
When considering an asset management approach, keep these tips in mind.
- Make asset management a program (and a priority!)
- Develop an Asset Management Policy – Your commitment statement
- Create and charter a steering committee led by the department head to oversee the program
- Define meaningful levels of service
- Develop performance measures –Set targets and review progress (at least quarterly) and commit to addressing problems
- Develop a risk profile for the organization – Help focus your efforts
- Assess data needs and gaps – Establish a plan to address gaps
- Train staff on the fundamentals—Levels of service, risk and consequence, performance measurement, business case development
- Require business cases – Subject these to steering committee review
- Educate decision-makers
- Communicate progress and recognize successes
- Take field trips to visit best practice organizations
Whether you are new to the asset management concept or if you have best practices to share, I encourage you to read our series of blogs on asset management best practices . Have questions about CH2M HILL’s asset management services? Contact them!
CH2M Hill is a global leader in the delivery asset management services for utilities, ports, airports, transit departments, private sector companies, and cities and towns.